ISA ideas for each generation

Sam Slator 16/03/2021 in Specialist investing

From spending habits to life goals, generational gaps, it seems, will not fade away. And that’s perhaps not surprising when you think that the economic and social environment into which you are born and grow can define your views on the world – shaping your outlook and your beliefs.

And, as we move through the generations ourselves, so our views and habits can evolve. From selfie-sticks to walking sticks, priorities change. But how does this impact our investment philosophy?

When it comes to investing, generally speaking, the longer you have to invest, the more risk you can afford to take. And, as you get closer and closer to retirement and move from accumulating your wealth to using it to live on, so the amount of risk should reduce.

As we approach the end of ISA season, we take a look at some investment ideas for each generation.

Generation Alpha and Generation Z

These two generations encompass anyone under the age of 24 – from new born babies to those in higher education or just starting out in their careers. At this age, you can afford to take a lot of risk for potentially greater rewards.

Sanlam Artificial Intelligence

Investing in a current global trend, this fund ‘eats its own cooking’ using an artificial intelligence (AI) system to help find companies whose business models are aligned to benefit from this growing theme. The fund invests in more than just technology stalwarts; around half of the portfolio can be found in the healthcare and consumer-related sectors.

GQG Partners Emerging Markets Equity

GQG, which stands for ‘global quality growth’, is one of the newest and fastest growing asset management businesses, having only launched in 2016. This fund is a concentrated portfolio of high quality companies with durable earnings. The emphasis is on future quality, rather than companies which have simply done well historically.


Ranging from their mid-twenties to the big 4-0, this generation is likely to have varying priorities. Some will still be early in their careers and single with fewer responsibilities. Others may be saving for a house deposit while others may have children of their own. Either way, when it comes to long-term goals like retirement, they still have a twenty to forty years to invest.

Liontrust UK Smaller Companies

Managed by the successful team behind Liontrust Special Situations fund, Liontrust UK Smaller Companies fund employs the same investment strategy but with a small-cap bias. The distinctive investment process focuses on firms with strong positions within their industries. The fund has a great track record and is particularly strong in down markets.

Fidelity China Special Situations

This trust invests predominantly in companies listed both domestically in China and on the Hong Kong Stock Exchange. The manager is able to make use of Fidelity’s investment licences in China, which are among the largest of any international investor, offering investors direct exposure to the China growth story.

Generation X

This generation is likely to be enjoying peak earnings, with a bit more spare cash to enjoy. While retirement is probably a subject they are now planning for more meaningfully, there are still one to two decades left on their time horizon – plenty of time to maximise contributions and still take some risk.

Jupiter Asian Income

The manager of this fund combs the breadth of the Asia Pacific market in search of large companies with reliable dividends that can deliver both income and growth for investors. He aims to capitalise on the opportunities of today, as well as the potential of tomorrow.

Waverton European Capital Growth

This is a high conviction fund focuses on finding reforming large and medium-sized European businesses, which can create wealth and returns for shareholders. It has a clear and common-sense strategy and the two fund managers have been working on the strategy together since 2001.

Here what co-manager Chris Garsten had to say about investing in Europe in this video interview:

Baby Boomers

Some of this generation may be lucky enough to have taken early retirement or are retired already. Others will still be working. But as people live longer in retirement, making the pot of money work hard for you, even when you have stopped contributing, will be a priority.

M&G Optimal Income

M&G is perhaps the biggest name in the UK bond space, and M&G Optimal Income is its flagship offering. This ‘go-anywhere’ fund has a flexible mandate, which enables the manager to shift the interest rate exposure and to invest across the fixed income spectrum. The fund can, and often does, invest in some equities, and also derivatives.

Schroder Income

This is a deep value-driven fund that invests in companies valued at less than their ‘true’ worth and waits for a correction. It has little correlation with other income funds, tending to avoid the big income producers in favour of more niche names, where both capital as well as income can grow significantly.

This article is provided for information only. The views of the author and any people quoted are their own and do not constitute financial advice. The content is not intended to be a personal recommendation to buy or sell any fund or trust, or to adopt a particular investment strategy. However, the knowledge that professional analysts have analysed a fund or trust in depth before assigning them a rating can be a valuable additional filter for anyone looking to make their own decisions.Past performance is not a reliable guide to future returns. Market and exchange-rate movements may cause the value of investments to go down as well as up. Yields will fluctuate and so income from investments is variable and not guaranteed. You may not get back the amount originally invested. Tax treatment depends of your individual circumstances and may be subject to change in the future. If you are unsure about the suitability of any investment you should seek professional advice.Whilst FundCalibre provides product information, guidance and fund research we cannot know which of these products or funds, if any, are suitable for your particular circumstances and must leave that judgement to you. Before you make any investment decision, make sure you’re comfortable and fully understand the risks. Further information can be found on Elite Rated funds by simply clicking on the name highlighted in the article.